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The Hidden Cost of Worker Turnover: A Case Study in the In-Bond Industry in Mexico

G. William Lucker


Although Mexico's in-bond assembly (maquiladora) industry is one of the few sectors of the Mexican economy that continues to prosper, worker turnover has become a significant and growing threat to its vibrancy. Maquiladoras, or twin plants, are cooperative arrangements whereby Mexican labor, about 75 percent female, (Holden 1984) assembles components which are transported from the United States. Raw materials are cut or formed into recognizable parts in the U.S. and shipped "in-bond" into Mexico without paying Mexican duties. The asembled products are returned to the U.S. under special, favorable tariff arrangements.

Employee turnover, "the cessation of membership in an organization by an individual who received monetary compensation by that organization" (Mobley 1982:10), has always been a feature of the maquiladora labor force. However, turnover rates have been rising consistently over the last four years. They have gone from a monthly average of about 4.3 percent in 1982, to 4.8 percent in 1983, to 7.6 percent in 1984, to 8.1 percent in 1985 (Alderete 1985). Turnover rates in selected plants have reached as high as 15 to 20 percent a month (Moffett 1984). This compares with an average U.S. monthly manufacturing turnover rate of between 1 and 2 percent (U.S. Bureau of Labor Statistics 1980).

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Print ISSN: 0886-5655
Online ISSN: 2159-1229